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Private good - Definition and Overview |
| Related Words: Absolute, Anonymous, Antisocial, Clandestine, Closet, Concrete, Confidential, Covert, Defined, Discreet, Distinct, Esoteric |
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In economics Private good is an opposite of the public good.
Its main features are:
- excludability (also referred in this context as rivalry) - cannot be consumed by everybody since consumption by one person reduces or excludes consumption by another
- depletability (it is finite)
Private goods are almost exclusively made for profit.
An example of the private good is bread: there is a finite amount of it, and bread eaten by a given person cannot be consumed by another.
One of the most common way of looking at goods in economy, illustrated in the table below, is the classic division based on:
- is there a competition involved in obtaining a given good
- whether it is possible to exclude a person from consumption of a given good
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